How LendingTree May Affect Your Credit Score

Using LendingTree to compare loan offers won't harm your credit score. However, the process can lead to a hard inquiry if you formally apply with a lender from its network.

1. Initial Soft Inquiry: When you first check rates on LendingTree, the platform performs a soft credit pull. This initial step does not impact your credit score and is used to match you with potential lenders.
2. Reviewing Offers: Based on the soft inquiry, you will receive pre-qualified offers from various lenders. Simply viewing these potential loan terms and rates has no effect on your credit score.
3. Formal Application & Hard Inquiry: The impact occurs when you select an offer and proceed with a formal application directly with that lender. The lender will then conduct a hard credit inquiry, which can cause a temporary, minor drop in your score.
4. Rate Shopping Protection: Modern credit scoring models often group multiple hard inquiries for the same type of loan (e.g., mortgage, auto) within a 14- to 45-day period as a single event, mitigating the damage from comparison shopping.
5. New Account Impact: If your loan is approved and you accept it, the new account will appear on your credit report. This can influence your score by changing your credit mix and average account age.

How Much Will LendingTree Affect Your Credit Score?

When using LendingTree to compare loan offers, the effect on your credit score depends on the type of inquiry made by lenders. Here are a few key factors to consider:

• Soft vs. Hard Inquiries. The initial rate comparison is a soft inquiry and won't affect your score. Moving forward with a lender for a full application will result in a hard inquiry, which can have a minor impact.
• Rate Shopping Window. Scoring models often treat multiple hard inquiries for the same loan type within a short period as a single event. This allows you to shop for the best rates without a significant penalty to your score.
• Minimal Score Drop. A single hard inquiry might lower your credit score by a few points, but this effect is usually temporary. This small dip is often a worthwhile trade-off for securing a loan with a lower interest rate.

How You Can Avoid LendingTree Affecting Your Credit Score

Understand Soft vs. Hard Inquiries

LendingTree's initial process involves a soft inquiry, which does not affect your credit score. A hard inquiry, which can impact your score, only happens when you formally apply with a specific lender. Knowing this difference helps you manage your credit while comparing loan options.

Utilize the Rate Shopping Window

Credit scoring models provide a "rate shopping" window, typically 14 to 45 days. Multiple hard inquiries for the same type of loan within this period are often treated as a single inquiry, minimizing the impact on your credit score. Group your applications accordingly.

Apply Only When Serious

To safeguard your credit, only move forward with formal applications when you are genuinely ready to borrow. Submitting applications without a clear intent to secure a loan can lead to unnecessary hard inquiries that may negatively affect your score over time.

Choose the Right Card to LendingTree

No matter your current standing, improving your credit score is always possible with consistent, positive financial habits. An expert guide outlines several proven methods you can use to boost your score over time.

• Set up automatic payments. Your payment history is the most significant factor in your score, so setting up automatic payments and reminders ensures you never miss a due date.
• Reduce your credit utilization ratio. Aim to keep your credit utilization below 30% by paying down balances, requesting credit limit increases, or keeping old accounts open.
• Monitor your credit reports. Regularly obtain your free credit reports to identify and dispute inaccuracies, which can unfairly drag down your score.
• Become an authorized user. You can get added to someone else's credit card account with a strong payment history to help build your own credit profile.
• Diversify your credit mix. Lenders like to see that you can responsibly manage different types of credit, such as installment loans and revolving credit accounts.
• Limit hard inquiries. Avoid applying for too many new credit accounts in a short period, as each application can temporarily lower your score.

The Bottom Line

Using LendingTree to compare loan offers results in a soft credit pull that won't hurt your score. However, formally applying for a loan will trigger a hard inquiry from the lender.

Frequently Asked Questions

Does using LendingTree hurt your credit score?

No, using LendingTree to compare loan offers does not hurt your credit score. The platform initiates a soft inquiry, which is not visible to lenders.

How many points does LendingTree drop your credit score?

LendingTree's initial soft inquiry does not drop your credit score. A hard inquiry from a lender you choose may cause a temporary, minor drop of a few points.

Does LendingTree do a hard or soft credit pull?

LendingTree performs a soft credit pull to show you potential offers, which does not impact your score. A hard pull only occurs if you proceed with a lender.